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Sep 15, 2014
UK CPI seen falling to 1.5% in August - RBS
FXStreet (Łódź) - Ross Walker, Senior UK Economist at RBS expects UK CPI, due out on Tuesday, to slide to 1.5% in August from 1.6% seen in July, as a consequence of declining energy price inflation and a modest drag from food.
Key quotes
"Petrol prices are forecast to fall by 1.0% m/m in August, lowering the y/y rate to -5.3% from -2.9% (subtracting 0.08pp from CPI inflation)."
"Utility prices are forecast to be flat in the month, in line with the recent trend, and leaving they/y rate unchanged at 4.7%."
"Food & non-alcoholic beverage inflation in August is forecast to be marginally lower at -0.6% y/y from -0.4%, mirroring recent PPI data trends."
"Core CPI is forecast to remain at 1.8% in August – the bulk of the summer sales have passed & a normalisation in airfares is expected."
"RPI inflation is forecast to fall to 2.4% in August from 2.5% in July; RPIX to 2.5% from 2.6%."
"A 1.5% CPI inflation outturn in August would amount to a further undershoot of the MPC’s August
Inflation Report forecast of 1.81% in Q3 2014 (i.e., our forecast would leave CPI around 25bp below), which would, prima facie, make any further dissenting MPC votes in the context of the November Report less likely."
Key quotes
"Petrol prices are forecast to fall by 1.0% m/m in August, lowering the y/y rate to -5.3% from -2.9% (subtracting 0.08pp from CPI inflation)."
"Utility prices are forecast to be flat in the month, in line with the recent trend, and leaving they/y rate unchanged at 4.7%."
"Food & non-alcoholic beverage inflation in August is forecast to be marginally lower at -0.6% y/y from -0.4%, mirroring recent PPI data trends."
"Core CPI is forecast to remain at 1.8% in August – the bulk of the summer sales have passed & a normalisation in airfares is expected."
"RPI inflation is forecast to fall to 2.4% in August from 2.5% in July; RPIX to 2.5% from 2.6%."
"A 1.5% CPI inflation outturn in August would amount to a further undershoot of the MPC’s August
Inflation Report forecast of 1.81% in Q3 2014 (i.e., our forecast would leave CPI around 25bp below), which would, prima facie, make any further dissenting MPC votes in the context of the November Report less likely."